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Home Foreclosures: Know Your Rights

By: Sam Laksanasut (Real Estate Investor)

February 20, 2009

Foreclosures are big news these days. Between sub-prime mortgages falling apart and the stalling housing market, you could be forgiven for thinking most homeowners are on the verge of foreclosure. Although this is clearly not the case, if you are one of the unfortunate homeowners teetering on the edge of foreclosure, or against whom foreclosure proceedings have already begun, you should be aware of some important rights and responsibilities.

A foreclosure is a legal action in which a lender takes ownership of the property used to secure a loan because the owner failed to make required payments. Foreclosure can happen quickly. Although traditional foreclosures involve court supervision, not all foreclosures require court orders. Depending on your state and the original terms of your loan agreement, a foreclosure can be completed in 45 days or less. Still. If you are currently going through foreclosure, Don’t panic. Although this is a very stressful and serious situation, you do have options, and being pro-active is in your best interest. In fact, if the foreclosure is still in its early stages, it is likely that your lender would prefer to work things out with you and not foreclose.

Be Informed

When you first received notice of a foreclosure action, there are some important steps to take. First, identify the parties involved. Today, most mortgages are sold and repackaged so many times after the loan is first given. In some cases, the company that currently owns the loan won’t actually be the one with the authority to renegotiate or modify the loan. This means that the company starting foreclosure proceedings against you isn't actually the party you will work with. Although you may have originally worked with your local bank, your loan may now be owned by a larger company located in a different state. Knowing the parties should help prevent confusion and move the process along faster. It will also help protect against fraud. Once proceedings start, your name and address are public record, providing valuable information to individuals and corporations looking to prey on the vulnerable. Don't assume that just because a letter arrives in your mailbox that it is from a reputable, reliable source.

You should familiarize yourself with relevant state and federal laws and the policies of your specific lender. The Federal Trade Commission's Website ( www.ftc.gov...search "Foreclosures" ) Provides valuable information on how to find your state’s regulations and on avoiding foreclosure notice requirements etc..

Assess Your Options

If you are about to miss a payment or if you have received a foreclosure notice, you aren’t out of options yet. You should contact the "loss management" department of your lender immediately. Depending on your situation and lender, you may be able to refinance or determine a "work-out" plan. Although you still owe money, this will be prevent a foreclosure from appearing on your credit record and could save your home.

*** NEWS ALERT *** (Good news for those who qualify )

President Obama's economic stimulus package plan on Mortgage Bailout, Starting March 4, 2009

1. First call your lender to find out if you qualify - make sure you talk to the right person.
2. Ask for the application, follow the bank regulations, and prepare for all paperwork.
3. Remember this bill is for people who can help themselves thereafter.

Goodluck...